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Indus Towers Announces ₹2,640 Cr Share Buyback Amid Strong Q1 Results

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Synopsis:

Indus Towers approves a ₹2,640 crore share buyback at ₹465 per share, with Q1 net profit surging 43% to ₹1,925.9 crore and revenue rising 4.3% to ₹7,383 crore. EBITDA grew nearly 30% to ₹4,545.3 crore.

Indus Towers Share Update

Indus Towers Ltd. has approved a buyback of up to 5.67 crore equity shares, representing 2.1% of the company's paid-up share capital, for a total consideration of ₹2,640 crore. The buyback price is set at ₹465 per share, a 4% premium over the closing price of ₹447.95 on Tuesday.

The buyback will be executed through the "Tender Offer" route, where shares are repurchased at a fixed price. The record date for the buyback is set for August 9, 2024. This marks the first Indus Towers buyback in eight years, with the last occurring in 2016 when the company was known as Bharti Infratel.

Market Reaction and Insights

Indus Towers share prices have surged 120% in 2024. According to the analysts, the General Acceptance Ratio for the buyback is expected to be around 3.6%, excluding Bharti Airtel, while retail shareholders can expect an acceptance ratio close to 35%.

The announcement follows a wave of buyback declarations on Dalal Street after Finance Minister Nirmala Sitharaman's recent Budget speech, which changed the taxation on share buybacks.

From October 1, the income from buybacks will be taxed at the hands of shareholders instead of the company. This has prompted six companies, including Indus Towers, to announce or plan buybacks.

Indus Towers Q1 Results Summary

Indus Towers also released its June quarter results, reporting a net profit increase of 43% year-on-year to ₹1,925.9 crore. Revenue for the quarter rose by 4.3% to ₹7,383 crore.

The company's Earnings Before Interest, Tax, Depreciation and Amortisation (EBITDA) grew nearly 30% year-on-year to ₹4,545.3 crore, with the EBITDA margin expanding to 61.6% from 49.7% in the previous year.

Disclaimer: Investments in the securities market are subject to market risk, read all related documents carefully before investing. This content is for educational purposes only. Securities quoted are exemplary and not recommendatory.

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